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We are of the opinion that under all of the facts
and circumstances of this case a fair and reasonable
fee would be a total of 35% of the market value of the
bonds recovered, with Lynch to be responsible for the
payment of Reardon's fee of 15% of the market value of
the bonds recovered. As a result, Lynch must refund to
the estate the full amount of the compensation allowed
by the Court to Reardon. That is, Lynch must refund
the amount of $171,966.90 to the estate. In addition,
because Lynch paid Reardon's fee from estate assets
without any authority and because of our finding that
the amount of compensation taken by Lynch and Reardon
and allowed by the auditing judge is unreasonable and
excessive, Lynch must pay interest on the $171,966.90
refund at the rate of six percent from the date of
payment to Reardon until the date of the refund. Lynch
made the payment at his peril and deprived the estate
of the opportunity to earn interest on the money. It
is only fair that he now make the estate whole for the
estate's loss.
The $171,966.90 refund is, of course, in addition
to the refund of $23,559.09 which he must make on
account of the overpayment of his own fee.
Concerning the interest to be paid on the
surcharges imposed by the auditing judge on Lynch and
Reardon, it is apparent that the auditing judge imposed
interest on the full amount of the money he found that
Lynch received without subtracting from that amount the
amount of the compensation he found to be reasonable.
It was clearly error for the auditing judge to find
Lynch liable for the payment of interest on the full
amount of the money he found Lynch to have received.
Lynch's obligation for interest runs only on the
difference between the amount of money he took as his
fee and the amount of his fee which the auditing judge
found to be reasonable. That is, he need only pay
interest on the sum of $23,559.09 at the rate of six
percent from the time of receipt until the time of
refund.
Following the issuance of the Orphans' Court's opinion and
order on August 1, 1989, all parties appealed Judge Pawelec's
order to the Superior Court, which affirmed the order on June 13,
1990.
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